The cost of living and the cost of governmental collapse
“People have been worried about inflation for a very long time, and those fears have been unfounded.” So speaks the Prime Minister.
In other news, the latest inflation figures came out this week and they are immense.
The CPI hit 9% in the year up to April 2022. However, analysis from the Institute for Fiscal Studies (IFS) suggests the poorest households face inflation of 10.9%, which is three percentage points higher than that faced by the richest.
This is because poorer people spend a higher proportion of their income on energy and food.
A separate analysis from The Resolution Foundation made similar findings.
Not only is inflation at its highest for decades but it is also hitting poorer people the hardest. And all this comes off the back of 15 years of squeeze for less-well-off households.
It’s not a good situation and, for all that Boris Johnson loves to talk and loves to sound positive when he talks, no succour is on the horizon.
The economy is weak. The UK (and the entire West) needs to re-think its entire energy strategy (although at least there isn’t too much tension between adapting to climate change and divesting ourselves from energy supplied by tyrants, as both involve reducing dependence on fossil fuels).
But these are long-term problems. For poorer households, the crisis is right now, so the fix needs to be immediate.
Advice NI is one of the local organisations that produced a manifesto ahead of the Assembly elections earlier this month.
Although Stormont might not go anywhere, at least in the short term, those manifestos are as relevant now as they were a few weeks ago. Scope is likely to look at several of them in the coming weeks and months.
Firstly, however, let’s look at how they’ve responded to the cost-of-living crisis as inflation aims for the stars.
Head of Policy Kevin Higgins said: “People on the lowest incomes – both in and out of work – have endured a decade of austerity; with freezes and cuts to social security benefits.
“They now find themselves disproportionately affected by the current cost of living crisis; crushing energy bills and faced with the stark choice of going cold or hungry to make ends meet…
“The out-of-touch Chancellor has failed to recognise the plight of low-income families, choosing to ignore the current crisis by sticking to the out-of-date benefit uprating formula which uses the September 2021 inflation figure of 3.1%...
“Advice NI is calling for the Government to do more to help low-income families whose budgets are already at breaking point.”
This call for action is aimed at Westminster. That’s unsurprising, given Stormont has no Executive and that is unlikely to change soon. It is also the case that London has de facto control over social security.
Nevertheless, in normal times Stormont is more than capable of putting together an emergency support package to help people on benefits in general, or targeted at those in serious need in some other way. These are not normal times, however.
What else is Advice NI asking for?
Advice NI’s policy paper is a condensed list of asks. The entire document consists of bullet points under a series of more granular policy areas.
They want independent advice services to be better supported and nurtured, including with longer-term budgets. They say welfare reform should be subject to ongoing impact analysis and underpinned by “respect and dignity”, controversial measures such as sanctions and private work capacity assessments should be reviewed, the welfare process should include safeguarding, and loopholes should be closed.
Anti-poverty measures should include support for rising energy and fuel costs, a statutory commitment to tackle poverty, community wealth initiatives should be prioritised and government should become a living wage employer. To help keep debt under control current insolvency measures should be reviewed, Debt Relief Order criteria should be realigned with those in England, community financial options should be improved and better financial capability should be pursued through education and Community Champions.
To ensure income adequacy the organisation wants to see the end of benefits upratings freezing, the Living Wage should be “rolled out across Northern Ireland”, Universal Credit should apply equally to people under the age of 25, and a UBI pilot should be explored. They also want to see a fairer economy, with better opportunities for young people and those with disabilities, and a Green New Deal supported by Community Wealth Building.
On housing, they want greater rent protections, more affordable homes, and a review of the homelessness strategy. In health, they want better mental health provision and greater promotion of social prescribing. For children, they want an “effective, costed childcare strategy which accommodates all working patterns”, more support for SEN, and various strands of financial easement for parents.
To better address immigration and race discrimination, the organisation wants better advice and financial support for all newcomers to NI, including refugees and asylum seekers. And, finally, regarding digital inclusion and access to services, Advice NI wants to see various measures to ensure no-one is locked out from an increasingly digital world.
Advice NI’s manifesto is more or less a list of asks. And it’s a long list.
Realistically, Stormont couldn’t do all these things – certainly not in the short term – even with an Executive in place.
However, all governments have to make choices. Some of the measures proposed would come at little cost. Some would cost a fortune – but that doesn’t mean it isn’t money well spent.
Some combination of these policies could and would make life a lot easier for people in Northern Ireland.
Moreover, this sort of thing has broad political support. Scope recently examined the 2022 election manifestos of NI’s eight main political parties.
Seven of those eight parties placed a premium on tackling the cost of living. The only exception was the TUV, which said they “will not pretend that the Stormont Assembly can do much in face of a global rise in energy prices or international inflation trends”.
Well, the TUV only has one seat. The Assembly would, therefore, have a lot of people open to creating packages that help struggling individuals and families.
But the blunt truth is that, without an Executive in place, that won’t happen.
Meanwhile, the cost of living is set to rise even more next month.
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